This week’s big financial news story is the Bernard Madoff $50bn fraud. However it wasn’t till I heard the pronunciation of his name on the news that I began to take a deeper interest.
Madoff is pronounced “made off”. Why, I pondered, would anyone entrust large sums of money to a man whose own name warns you what he might do with it? I raised this with contacts in the investment world. One source, whose name is reminiscent of a hot milky drink, said “I suppose if his name had been pronounced “mad off” we might have thought twice about it.” So, even if your name was something like Robert Baron this would not be an impediment to starting an investment business, just so long as you are not actually perceived to be insane. That set me thinking some more.
In the UK the Financial Services Authority, known as the FSA is supposed to regulate and monitor our financial services industry to protect investors’ interests from the likes of Bernard Madoff. If you alter the word order to Services Financial Authority they become the SFA, a more accurate reflection of their competence and effectiveness to date. However this is described as “light touch” regulation and is deemed to be a good thing.
Then yesterday evening someone asked me a good question. What exactly is a hedge fund? I don’t know the answer. Does anyone? When I first heard the expression I light heartedly remarked why would anyone want to invest in hedges, but was told by people who know about these things that hedge funds don’t invest in hedges, they invest in “other things”.
Suddenly it all came together, a name that means what it says, a track record to date of unimpeachable sanity, “light touch” regulation and a proven money making technique. My idea for a new innovative investment vehicle was born. I will start a hedge fund that actually invests in hedges.
Why would this be an attractive proposition? Answer, bio fuels and biomass for power stations, two sure fire growth opportunities. I have been driving around the country and there are thousands of miles of hedges just standing there, sticking up out of the ground and no use to anyone, apart from a few wildlife, who would soon adapt anyway.
I would not of course get involved in actually selling hedges on to bio fuel producers and power generators, too much like real work. We would create a market in hedge futures and trade in Collaterised Hedge Derivatives. Above average returns to investors would be delivered from a combination of selling on these high yield financial instruments (all “financial instruments” are apparently high yield by definition) and money from new investors coming into the fund. I don’t see why all Bernard’s hard work perfecting this latter technique should go to waste and as I said there are miles and miles of hedges, not just in the UK either. The difference would be that we would still have the assets in the form of the hedges, so that should satisfy the SFA.
So watch out for the launch of Hawthorn Investments and get in on the ground floor, or perhaps into the ditch is a more appropriate expression.
Seriously though …. Sloppy and deliberately opaque and misleading language, designed to tell people what they want to hear rather than what they need to know, has become endemic in the business world and in the financial sector in particular. Governments and regulators have conspired in this also. If someone in authority had stood up and said very clearly that prime loans are loans to people that can repay whilst subprime are loans to people who cannot, would we be in the mess we are in now?
Having a laugh ..... seriously? is brought to you by Steve Goodman & Tony Ericson of ChangeWORLD. For even more serious information and comment go to our Exceeding Expectations blog and the ChangeWORLD website
Wednesday 17 December 2008
Friday 12 December 2008
High speed mail .... myth or legend?
Royal Mail has installed new route planning software called Pegasus, designed to provide post men and women with the optimum routes to follow on their rounds.
Now you would expect that the first silly story to emerge would be about posties being routed into ponds, getting their bikes stuck in narrow alleyways, or fleeing terrified along Motorways. Not so, it is all about the speed at which posties walk. The Communications Union and Royal Mail management seem to be arguing over the calibration speed for Pegasus – should it be 4 mph or 2.4 mph?
Your first thought like mine might be just how stupid can Royal Mail’s management be to have got themselves into this wrangle over the installation of software that sounds like it comes from Halfords. How could they do something so daft? Then, like me, you might try to have a kind thought - Was there something we didn’t know that could explain it? Yes, there is. We can now exclusively reveal that there was a secret dimension to Royal Mail’s master plan.
Apparently along with the Pegasus software Royal Mail was expecting to take delivery of a fleet of winged horses thus enabling our posties to achieve the higher speeds required. Further advantages include being able to hover out of reach of savage dogs whilst the postie shoots the mail through letter boxes using a golden bow and being able to outrun any Minators or Krakens that lurk in our sink estates.
The development of the winged horse is a separate Royal Mail and government backed project. The government believed this would put Britain in the forefront of winged animal technology. Flying pigs are apparently now off the drawing board in the US, so we must catch up. This technology offers the potential to replace un-green aircraft with low carbon flying equines - Heigh Ho Ryanhorse! – Giddy Up Easyhooves! Jumbo jets however may have to wait a bit.
However the project has run into delays. Eversokindandgentle Animal Research Ltd, was awarded the contract on the basis of “best value”. This was achieved by first outsourcing much of the work to Piratestan and then by using chickens to cross with horses, chickens being even cheaper and more plentiful than researchers in Piratestan. Results from the first trials have proved that chickens, even when crossed with a horse, still cannot fly, even to cross the road.
£2.4 bn of taxpayers money has been spent on the project so far. A spokesman for Eversokindandgentle stated that the project was still “on track” but as the line from Piratestan was a bit faint he might have said “con trick”. (see £2.4bn)
A further unresolved problem is waste as fleets of flying animals in our skies will bring a whole new meaning to the words "atmospheric emissions". A recent clandestine trial involving the RAF flying over central London dropping carefully measured amounts of horse s**t was inconclusive. It proved impossible to distinguish between what was dropped from the aircraft and the much larger amounts of similar material generated from buildings in and around Downing Street and Westminster.
Seriously though .... On the One hand - None of the statements we have read on this story from either Royal Mail or the Union contain the word Customer. On the Other Hand - Several statements from individual post men and women do refer to Customers. Is that where the real problem lies?
Having a laugh ..... seriously? is brought to you by Steve Goodman & Tony Ericson of ChangeWORLD. For even more serious information and comment go to our Exceeding Expectations blog and the ChangeWORLD website
Now you would expect that the first silly story to emerge would be about posties being routed into ponds, getting their bikes stuck in narrow alleyways, or fleeing terrified along Motorways. Not so, it is all about the speed at which posties walk. The Communications Union and Royal Mail management seem to be arguing over the calibration speed for Pegasus – should it be 4 mph or 2.4 mph?
Your first thought like mine might be just how stupid can Royal Mail’s management be to have got themselves into this wrangle over the installation of software that sounds like it comes from Halfords. How could they do something so daft? Then, like me, you might try to have a kind thought - Was there something we didn’t know that could explain it? Yes, there is. We can now exclusively reveal that there was a secret dimension to Royal Mail’s master plan.
Apparently along with the Pegasus software Royal Mail was expecting to take delivery of a fleet of winged horses thus enabling our posties to achieve the higher speeds required. Further advantages include being able to hover out of reach of savage dogs whilst the postie shoots the mail through letter boxes using a golden bow and being able to outrun any Minators or Krakens that lurk in our sink estates.
The development of the winged horse is a separate Royal Mail and government backed project. The government believed this would put Britain in the forefront of winged animal technology. Flying pigs are apparently now off the drawing board in the US, so we must catch up. This technology offers the potential to replace un-green aircraft with low carbon flying equines - Heigh Ho Ryanhorse! – Giddy Up Easyhooves! Jumbo jets however may have to wait a bit.
However the project has run into delays. Eversokindandgentle Animal Research Ltd, was awarded the contract on the basis of “best value”. This was achieved by first outsourcing much of the work to Piratestan and then by using chickens to cross with horses, chickens being even cheaper and more plentiful than researchers in Piratestan. Results from the first trials have proved that chickens, even when crossed with a horse, still cannot fly, even to cross the road.
£2.4 bn of taxpayers money has been spent on the project so far. A spokesman for Eversokindandgentle stated that the project was still “on track” but as the line from Piratestan was a bit faint he might have said “con trick”. (see £2.4bn)
A further unresolved problem is waste as fleets of flying animals in our skies will bring a whole new meaning to the words "atmospheric emissions". A recent clandestine trial involving the RAF flying over central London dropping carefully measured amounts of horse s**t was inconclusive. It proved impossible to distinguish between what was dropped from the aircraft and the much larger amounts of similar material generated from buildings in and around Downing Street and Westminster.
Seriously though .... On the One hand - None of the statements we have read on this story from either Royal Mail or the Union contain the word Customer. On the Other Hand - Several statements from individual post men and women do refer to Customers. Is that where the real problem lies?
Having a laugh ..... seriously? is brought to you by Steve Goodman & Tony Ericson of ChangeWORLD. For even more serious information and comment go to our Exceeding Expectations blog and the ChangeWORLD website
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